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August 2005
Once established,
failure to use the properly established
classification description and rating:
Surprisingly, errors often are made in the
description of a product on bills of lading, even if
the proper description has been established with the
classification board. The exact and full description
must be used and preferably a specific national
motor freight classification item number typed or
pre‑printed on each bill of lading. Failure to
properly describe and apply the proper
classification, gives the carrier the opportunity to
use its classification “expertise” to properly rate
the product. The possibility of the carrier always
being correct is rather remote! But you can be sure
that if there is a rating alternative more favorable
to the carrier, that’s the decision that will be
made!
This sort of missed opportunity to protect against
excess transportation costs can be a substantial
loss, and yet the actual freight "rates" are correct
but the "base" from which the charges are derived is
from an incorrectly used description of the product.
This can easily lead to invalid cost projections in
locating new production facilities or in evaluating
the proper distribution center configuration. Even
the actual payment of the billed charges will appear
to be perfectly correct as audited, particularly if
audited by using an exclusive computerized based
system.
This could result in a serious cost error that could
easily be corrected, by taking appropriate
corrective action. If you are not sure, ask for help
from your prime carrier or the staff at the National
Motor Freight Classification. The staff is very
helpful and can guide you on what your options may
be in correcting any classification problems. The
staff is highly competent and is usually extremely
helpful in answering questions, since input from the
shippers is sought on all publicly docketed issues
and is part of their Agreement which permits them to
take collective classification actions and obtain
anti-trust immunity. The responsible corporate
parties in executing the proper description have to
be the “Team Group C.” Establishing the class
rating itself may consider enlisting the input from
members of “Team Group A.” |
